Britain would be less well off after Brexit: OECD

LONDON: Britons would be less well off if they voted to leave the European Union than if they stayed, the head of the Organization for Economic Cooperation and Development (OECD) said on Wednesday.

“Brexit is like a tax. It is the equivalent to roughly missing out on about one month’s income within four years,” secretary general Angel Gurria told BBC radio ahead of the publication of an OECD report on the subject.

“In comparison with a baseline scenario (of what) they would otherwise have had in their pocket… they will not have it — therefore it is as powerful, as real, as a tax,” he added.

The OECD joins a growing list of international organisations warning of the potentially damaging effects of Britain voting to leave the EU in a June 23 referendum, including the International Monetary Fund and G20.

Gurria’s analysis echoes that of the British finance ministry, which warned this month that Britain would be “permanently poorer” if it left the 28-nation bloc.

It estimated the cost to each household could be £4,300 (5,400 euros, $6,100) a year.

Campaigners to leave the EU dismissed the forecast as “flimsy”, and repeated their arguments that Britain could forge a successful future outside the bloc.

OECD chief Gurria said such ideas were “wishful thinking”, however, saying: “There is absolutely no reason why you would get a sweeter trade deal than you already have.”

He was speaking ahead of the publication later Wednesday of an OECD analysis of the effects of a so-called Brexit.

“We have done the comparisons, we have done the simulations. We’ve gone through the different ways in which this will happen,” Gurria said.

“In the end we come out and say: why are we spending so much time, so much effort and so much talent in trying to find ways to compensate for a bad decision when you do not necessarily have to take the bad decision?”

Opinion polls suggest the British public is divided over whether to stay in or leave the EU, although the “Remain” campaign, which is backed by Prime Minister David Cameron, has a slight lead.